Homes in Daly City, California, US, on Tuesday, May 19, 2026.
Jason Henry | Bloomberg | Getty Images
Overall mortgage demand essentially flattened last week, as interest rates continue to hover in a narrow range. Borrowers are also pulling back from riskier loans, as they are offering smaller advantages.
Total mortgage application volume increased 0.04% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances, $832,750 or less, decreased to 6.57% from 6.59%, with points increasing to 0.65 from 0.63, including the origination fee, for loans with a 20% down payment.
The average rate for a five-year ARM, or adjustable-rate mortgage, increased to 5.79% from 5.68%. ARMs are considered riskier because they reset to the market rate after the fixed term. They do generally offer lower rates, but the spread between ARMs and the 30-year fixed is shrinking. ARM loans accounted for just 7.6% of all applications last week, the lowest share since January and down from a high of 9.6% in mid-May.
“Mortgage rates eased slightly last week as oil prices declined. As a result, mortgage applications increased modestly, with an uptick in purchase activity offsetting a smaller decline in refinances,” said Joel Kan, vice president and deputy chief economist at the MBA, in a release.
Applications to refinance a home loan fell 1% for the week and were 9% higher than the same week one year ago. One year ago, the average rate on the 30-year fixed mortgage was 22 basis points higher.
Applications for a mortgage to purchase a home rose 1% and were just 3% higher than the same week one year ago. Buyers continue to contend with both inflation and uncertainty in the broader economy.
“Purchase applications remain ahead of 2025’s pace and have exhibited year-over-year growth for almost three months, as prospective homebuyers are finding opportunities in markets with ample inventory and easing home-price growth,” Kan added.
